Oreo’s Global Marketing Strategy

Executive Summary

The executive summary offers an in-depth analysis of Oreo’s global marketing strategy and its applicability to the USA and Turkish markets. Oreo has been able to successfully navigate and penetrate the USA competitive market through employing the adaptation and standardized market approaches and also by tailoring its products to meet the needs of the local market while upholding its premium positioning in the global market. The entry strategy, pricing approaches and distribution choices in the USA also align with the market dynamics of the country and this has enabled the company to sustain its market presence. In consideration of Turkey, Oreo has been able to adapt its approaches to the emerging and diverse market by considering aspects such as local tastes and affordability. The localization efforts by the company, adaptive pricing, and distribution partnerships have contributed to the overall success of the company in Turkey. The use of both the digital and traditional approaches in marketing together with corporate social responsibility initiatives has enabled Oreo to develop brand visibility and a positive public image enhancing its revenues and profits in the USA and Turkey. The ability of Oreo to balance standardization and adaptation has ensured that the company can meet the changing needs of consumers across its global market.

Oreo

1.1 Global Profile of the Company

Oreo is a multinational American company that operates in the confectionery, food and beverage sector and specializes in the production and sale of cookies that are enjoyed in over 100 nations across the globe. As established by Masud (2020) company mainly focuses on the production of sandwich cookies made up of two cookie pieces or cocoa biscuits with a fondant filling. The Oreo cookies are present in over a hundred nations, there have been various varieties of these cookies since their inception in 1912, but in the contemporary market, only limited editions are available (Limensa, 2018). The mission of Oreo is to become a leader in the world of snacking by offering its consumers the correct snack, for the right moment, created in the right way. From this mission statement, the company has a focus on delivering a vast range of outstanding and delicious snacks created from sustainable ingredients to nourish the life of the consumer. As pointed out by Steenkamp and Steenkamp, (2017) the vision of the company is to meet the needs of the consumers by adhering to the set ethical standards and doing the right thing with loyalty and honesty in mind, the objectives of the company include connecting people from the different parts of the world with their outstanding snack. The net revenue for Oreo in the first quarter of 2023 stood at $9.17 billion an increment of 18.1% from the last quarter of 2022, this exceptional growth was due to the solid volume growth and offsetting of cost inflation (Statista, a2023). The net revenue of the company by the end of 2023 was $31.5 billion and the company was ranked in the 3^rd position out of 237 competitors among global cookies and confectionery sells via net sales (Statista, b2023). The analysis focuses on evaluating Oreo’s international marketing strategy in the USA and Turkey considering both similarities and differences in its marketing strategies in these two countries.

1.2 Environmental Analysis

1.2.1 Macro Analysis (PEST)

Macroenvironmental analysis focuses on the identification and analysis of the opportunities and setbacks that a business can face when operating in a given environment. Moreover, the approach prepares the management in advance by providing them with the necessary information that can be used to make operational decisions (Perera, 2017). The macro analysis for Oreo’s market presence in Turkey and USA will be conducted through the use of the PEST framework that will look at the political, economic, social and technological factors affecting the company in the two countries.

1.2.2 Micro Analysis

Consumer Analysis in USA and Turkey

Competitor Analysis

In the USA, Oreo has several competitors including; Partake Foods, Chip City Cookies, Catalina Crunch and Last Crumb, however, the largest competitor based on product similarity is Hydrox. In terms of revenue and profitability Oreo has been performing exemplary when compared to Hydrox (Santander Trade, 2023). However, the main strength of hydroxy is that it is much crunchier than Oreo and has a less sweet filling thus is a consideration for health-conscious consumers who consume less sugar. However, the main weakness is that Hydrox is considered an Oreo off-brand and has not invested in contemporary marketing strategies to meet the needs of modern-day of consumers. The main competitors for Oreo in Turkey are both domestic and global companies which include Ulker Chocolate, Eti Tuktu and Nestle Chocolate. The main strengths of these competitors are that they understand the local market and have tailored their products to meet the needs of the local market. The major weakness for the two local players is that they have limited recognition in the global market and Nestle is that it faces intense competition from other international brands (BBM, 2018). The implication of this for the future of Oreo in Turkey is that the company should focus on localizing its products to beat local competition via the use of local ingredients and understanding local preferences.

2.1: Assessing the Country Attractiveness and Entry Strategy

2.1.1 Assessing the Country Attractiveness

2.1.2 Entry Strategy

2.2 Strategic Marketing Formulation

In this segment, the analysis will focus on analyzing the global segmentation, targeting and positioning approach by Oreo both in Turkey and the United States of America. The STP can be used to make the marketing communication of the company more relevant, focused and personalized for its global consumers.

Segmentation

In consideration of segmentation, Oreo considers geographic, psychographic and demographic segmentation to access its global consumer base. Looking at geographic segmentation, Oreo has been able to penetrate all markets in the global spectrum due to the popularity of its products across the globe (Owen et al., 2022). Moreover, the aspect of geographic segmentation has been complemented by psychographic segmentation as this complement considers the opinions and lifestyle of the consumers, their interests and also expectations (Telnov and Zozulya, 2023). Looking at demographic segmentation, Oreo mainly focuses on adolescents and children targeting ages 6 to 28 years, this segmentation is complemented by the affordable pricing of the company’s products and through this Oreo has been able to win the hearts of adolescents, young children, university students and families (Grayson, 2023). This segmentation approach has been able to meet the needs of all family members creating a sense of tranquility and comfort.

Targeting

The target segment of Oreo is divided into major categories which are the primary and secondary target segments. The primary segment consists of children, adolescents and young adults in college, the primary buyers share common behaviours and characteristics and account for the highest sales. As established by Lu (2023) the second market consists of those purchasing at high rates but within a meager segment and consumers who influence the primary buyers. The secondary market consists of parents and adults whose purchasing power is high and can influence the primary market to consume Oreo products. The secondary target market has an irregular work schedule; a fast-paced lifestyle and a rising income which makes them become regular consumers of Oreo products (Grayson, 2023). The successful implementation of segmentation, targeting and positioning shows that the company has been able to maintain its global position and thrive in the snacking industry.

Positioning

In consideration of positioning, Oreo uses an emotional appeal to enhance the binding force that exists between children and parents. Oreo has been able to place itself as a mid-meal or a tasty snack and this is part of the consumption culture of Oreo’s global market, the snack is also considered a leisure snack due to its convenience, portability and taste (Strutton and Schibik, 2023). Oreo has positioned itself as the world’s best producer of cookies and through this has implemented the ‘twist-lick-dunk- approach which has effectively tapped into young consumers to the point that they argue with their parents to purchase them Oreo products (Lu, 2023).

3.1 Standardization vs. Adaptation (Product Decision)

In the USA Oreo considers a combination of adaptation and standardization for its main product offerings. The original Oreo Cookie with its sweet cream and chocolate wafers remains a standardized product and this has helped the company to leverage its robust brand recognition and also has ensured consistency (Telnov and Zozulya, 2023). This approach is in line with the diverse and mature consumer base in the USA, where most of the consumers have a high acceptance of global brands and have a preference for familiar products. However, the company has also embraced adaptation and this can be seen from its limited-edition offerings and localized flavours to match the needs of the USA market (Masud, 2020). The approach has enabled the company to tap into the US consumer market and its appreciation of variety and innovation. The adaptive approach has enhanced the relevance of the company in this market that appreciates innovative and traditional products. In Turkey, the product decision of the company is more adaptive due to the cultural and distinctive preferences of the Turkish market (Ruble, 2021). For this reason, the classic Oreo has undergone modifications that resonate with the Turkish market preferences such as the addition of spices and fruits. Furthermore, the pricing strategy and packaging size have helped the company resonate with the purchasing power and economic realities of Turkey consumers (Evcen, 2019). This approach is vital in navigating the consumer spectrum in Turkey where culture is of great significance. While upholding its global presentation, the company understands the need to integrate cultural and local elements in its product offerings in Turkey (Owens et al., 2022). The decision by the company to combine the adaptation and standardized approach in Turkey and the USA is in line with the environmental analysis in the two countries. In the USA, the market embraces global trends, and is stable and mature and thus standardization has allowed the company to establish and maintain its position in the market (Masud, 2020). The introduction of the adaptation approach in the US market through the introduction of localized flavours and limited editions matched the needs of the consumers of innovation and demand for new flavours. In Turkey, the adaptation approach has been effective based on the cultural nuances, economic considerations and preferences of the consumers (Economist Intelligence, 2023).

3.2 Standardization vs. Adaptation (Distribution Decision)

The distribution strategy considered by Oreo in the USA is highly standardized based on the efficient networking infrastructure in the country and the sophisticated and mature nature of the company. The brand positions itself with leading convenience stores and major supermarkets to ensure that its products can meet the demands of the consumers. The standardized approach has also emphasized the need to embrace e-commerce and tap into the new online shopping tendencies in the US market (Parcha, 2023). The approach has ensured that Oreo can meet the demands and needs of the consumers on time. This standardized approach in the USA is a complement to the entry strategy where the company in the territory collaborates with leading retailers to meet the needs of the consumers. The standardized approach has been effective in the US since the consumers in the territory expect their demands to be met on time and can be accessed easily.

In Turkey, the company has adopted the adaptive distribution strategy to the unique needs of this developing market, the approach in the country includes the blend of modern and traditional channels which involves leveraging the local importers and wholesalers (Evcen, 2019). The adaptation strategy is aligned with the company’s entry strategy in Turkey which involves adapting and comprehending the local needs of the consumers (Owens et al., 2022). Partnering with the local wholesalers and importers has helped Oreo to develop insights into the dynamic nature of the Turkish market and this has helped the company deal with economic challenges and infrastructural landscape of the country.

From the above analysis, it is evident that the distribution channels in the USA and Turkey are aligned to the entry strategies of the company in the two countries and this has contributed to the effectiveness of Oreo in these territories. In the USA, the standardized approach aligns with the well-established and mature distribution channels and this has ensured consistency in the availability of the company’s products to the consumers. The adapted distribution approach in Turkey meets the needs of the company’s entry strategy which focuses on a localized and flexible approach (Economist Intelligence, 2023). By working with local distributors, Oreo has been able to maximize its reach to the market allowing for the effective distribution of its products.

The distribution decision of Oreo in Turkey and the USA shows a strong balance between the adaptation and the standardization approaches and this has helped the company to meet the unique needs of the two markets (Evcen, 2019). The effectiveness of the two choices is aligned to the entry strategies and this has been fundamental in helping the company maximize its accessibility and reach in the two markets. The two different approaches in the two countries have facilitated the entry of the company into the new markets leading to sustained success.

3.3 Pricing Decision

In the USA, Oreo applies a pricing strategy that meets the needs of the competitive market in the country and the mature nature of the consumers. The company considers itself a premium snack and this is reflected in its pricing strategy. The product offerings of the company including the classic cookie are priced higher when compared to generic and local alternatives. This pricing approach is aligned with the purchasing power of US consumers, who are willing to pay premium prices for global and well-established brands (Ruble, 2021). The approach in the UK is aligned with the environmental analysis of the USA, which shows that a high percentage of the populace has a disposable income and thus they can afford premium products provided by the company (Ruble, 2021). The STP analysis shows that the consumer target of Oreo in the US includes individuals who appreciate quality, the global reputation of the brand and the availability of its products. The pricing strategy of the company reinforces its position in the market as an effective, indulgent and high-quality snack that appeals to consumers.

In Turkey, Oreo considers an adaptive pricing approach that meets the needs of the local consumers and also reflects the economic position of the country (Santander Trade, 2023). Recognizing the need for affordability the purchasing power of the consumers and the need for affordability in the Turkish market has made Oreo adjust its pricing strategy to ensure that its products are easily affordable and accessible in this market (Ruble, 2021). In Turkey, Oreo has introduced more affordable and smaller packed products that align with the income distribution in the country.

The effectiveness and impact of Oreo’s pricing strategy in Turkey align with the macro and micro environmental analysis that requires a pricing strategy that can address the issue of affordability. Moreover, the pricing strategy in Turkey is aligned with the purchasing power and local preferences of this market. Looking at the pricing strategy of Oreo in the USA and Turkey it is evident that the brand has been able to tailor its prices to meet the unique needs of the two markets. The premium pricing approach in the USA shows that the company is aligned with the economic stability of the company and premium positioning of the brand. In Turkey, the adaptive pricing approach resonates with the economic conditions of the country and the purchasing power of the country’s populace (Ruble, 2021). The effectiveness of the pricing strategy in the two countries shows the flexibility of the company towards aligning itself with the needs of the consumers (Economist Intelligence, 2023). The alignment of the pricing strategies with the unique needs and characteristics of the two markets shows that Oreo can meet the needs of its consumers and also align itself with the various consumer segments in its global market spectrum.

3.4 Promotion Decision

The promotion decision of Oreo in the United States of America considers both the digital and traditional approaches to access its diverse consumer base. The promotion decision of the company in the US is dictated by the affinity of its consumers in the country to global brands, technological advancements and the maturity of the market (Crofton and Scannell, 2020). To sustain its brand visibility and awareness in the USA Oreo considers the use of social media, digital platforms and television commercials. To achieve this, the company has invested heavily in developing advertisements that appeal emotionally and visually to the consumers highlighting the delight and joy associated with the consumption of Oreo products.

The environmental analysis of the US market shows that this particular market embraces both innovative and traditional products and for this reason, Oreo focuses on aligning its advertising approach by exhibiting the classic Oreo with new flavours (Ruble, 2021). The targeting and segmentation approaches of the company focus on both adults and children emphasizing the diverse and versatile nature of the Oreo cookie. Oreo’s positioning in the USA is timeless as it can bring happiness to consumers of all ages. The promotion approach by the company cements its position in the market by associating Oreo’s brand with positive emotions that resonate with its target audience (Santander Trade, 2023). The promotion and advertising approach used by Oreo in the US market is effective and efficient in meeting the preferences of its consumer base and enhancing the development of brand loyalty and visibility.

In the Turkish market, Oreo considers a nuanced promotion strategy that shows a comprehension of the economic and cultural factors that influence consumer behaviour in the country. This nuanced approach combines both the novel and traditional forms of advertising. The microenvironment evaluation of Turkey shows that the country has a diverse consumer base that has varying preferences and tastes (Parcha, 2023). For this reason, the advertising approach in the country considers local flavours, and affordability and embraces adaptation. The targeting and segmentation considers the income distribution and economic diversity of the country making the brand accessible to a wide consumer base. Oreo’s positioning in Turkey focuses on the ability of the brand to lighten the lives of consumers (Economist Intelligence, 2023).

Through the years, Oreo has shown its commitment to meeting the needs of its consumers through its corporate social responsibility (CSR) activities. The CSR activities by the company have played an influential role in shaping the company’s public relations across its various markets including Turkey and the USA. In both markets, Oreo engages in CSR initiatives to ensure the well-being of the community, and promote ethical sourcing and sustainability (Ruble, 2021). In the USA, CSR activities by Oreo include working with local communities and organizations to conserve the environment and promote childhood education. Such initiatives have helped the company to portray itself as a brand that resonates with local consumers. In the Turkish market, the CSR efforts of the company have been demonstrated in developing healthcare and education. This approach has been able to create a positive and formidable relationship between the company and its consumers in Turkey.

From the analysis, it is evident that the advertising approach of the company in the USA aligns with the nature of the country’s mature and developed market. The use of both the digital and traditional approaches helps the company to engage with its diverse target market. As established by Parcha (2023) by putting emphasis on the versatility of the company and creating happiness among the consumers, the company can resonate with the preferences and needs of its consumer base in the country. The outcome of this is that Oreo has developed to become a trusted brand (Ruble, 2021). Oreo’s campaigning approach in Turkey has helped it to adapt to the economic consideration of the country enhancing its ability to reach out to the diverse consumer base in the country (Turkish Plaza, 2024). The increasing popularity of the brand in the country is a reflection of its effective advertising approaches.

4.0 Conclusion

The global marketing strategy implemented by Oreo shows that the company can navigate and penetrate diverse markers as seen in the case of the USA and Turkey. The analysis shows that Oreo can blend both the adaptation and standardization approaches in its product, distribution, pricing and promotion approaches shows that the company understands the unique needs of its different markets. In the USA, Oreo focuses on the adaptation of a premium strategy, sophisticated advertising and standardized distribution to meet the needs of the affluent and mature consumer base. Additionally, in Turkey, the company considers local distribution, adaptive pricing and advertising that are aligned to the needs of the local community. This approach is an indicator that the company is committed to meeting the needs of its diverse market and that its global marketing strategy is aligned with the micro and macro environment evaluation. The analysis indicates that Oreo can tailor its product offerings to accommodate the needs of its global market. The commitment of the company to CSR initiatives is also an indicator that it is focused on enhancing its brand visibility through the creation of a positive image.

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